The decision by Moody’s Investor Services on Friday night to hold South Africa’s sovereign credit rating at “Baa3” with a "stable outlook” is good news for the South African economy, the Democratic Alliance said.
This comes after a series of bad news stemming from negative ratings from ratings agencies. These negative ratings were seen as a clear vote of no confidence in former finance minister Malusi Gigaba and former president Jacob Zuma, DA spokesman Alf Lees said.
"Friday’s decision by Moody’s highlights the fact that 'political developments' over the past two-and-a-half months have had a positive impact on the outlook of ratings agencies and thus of potential investors. However, for significant investment to take place, it will require a sustained programme of action by President Cyril Ramaphosa and Finance Minister Nhlanhla Nene," he said.
"The ratings action means our long-term local currency debt, which forms 88.2 percent of our R2.2 trillion net debt, remains at one notch above 'junk status'..."
The populist expropriation of land without compensation as well as uncertainty around the mining charter should never be used to keep a divided African National Congress together at the expense of ratings and business confidence. This would only serve to subdue investment, Lees said.
There were 9.2 million South Africans who did not have work or access to any social security. These South Africans deserved more from Ramaphosa's government.
"President Ramaphosa’s primary focus should not be on populist narratives that seek to placate dissent within the ANC while ignoring the poor. The welfare of ordinary South Africans supersedes the ANC’s narrow party political interests," Lees said.
- African News Agency
